NCTO Comments on Phase One Deal on 301 Tariffs

WASHINGTON-The National Council of Textile Organizations (NCTO) provides initial comments on the “phase one trade deal” reached between the United States and China.

According to the proposed arrangement, the 301 duties on textile inputs remain at 25%. Meanwhile, penalty tariffs on finished apparel and textile goods implemented on Sept. 1 go down from 15% to 7.5%. Proposed tariffs on finished products, set for Dec. 15, are not in effect.

NCTO’s president and CEO, Kim Glas, says, “NCTO has strongly supported applying tariffs on finished products as key negotiating leverage since textile and apparel production is a key pillar of the Chinese manufacturing economy. Finished apparel, home furnishings, and other made-up textile goods equate to 93.5% of U.S imports from China in our sector, while fiber, yarn, and fabric imports from China only represent 6.5%, according to government data. Today’s announcement reduces tariffs on finished products at the same time it keeps tariffs in place on key inputs that aren’t made in the U.S. such as certain dyes, chemicals, and textile machinery.”

The organization thinks a better approach is to keep penalty tariffs on finished Chinese products and reduce 301 duties on “key inputs used by U.S. manufacturers,” according to Glas. This would encourage China to establish a “comprehensive and enforceable intellectual property agreement.”

For more information, visit www.ncto.org.